How it Works.

The initiative leverages privately managed investment funds, known as Small Business Investment Companies (SBICs), that are licensed and regulated by SBA to make loans or equity investments in U.S. small businesses. These funds raise capital from private investors, and SBA provides government-guaranteed financing that increases the amount of capital available for investment. The NASA-SBA partnership helps direct that investment toward technologies, suppliers, and manufacturing capabilities that support future missions.

Beyond Traditional Bank Financing.

Banks are often the right choice for working capital, equipment purchases, and businesses with predictable cash flow. Traditional lenders typically focus on a company’s ability to repay based on current assets, collateral, and financial performance. However, businesses developing new technologies, expanding manufacturing capacity, or scaling operations may need capital that doesn’t fit neatly into a conventional bank loan. Through the NASA-SBA partnership, small businesses may gain access to investment capital that can provide financing options a traditional bank cannot.

Flexible Financing Options.

Investment capital may be structured as a loan, an equity investment, or a combination of both, depending on the needs of the business and the investment strategy of the fund. While NASA helps identify strategic technology priorities and SBA licenses and oversees participating funds, individual investment decisions are made by the privately managed investment funds, not by NASA or SBA.  A typical investment is made over a three-year period and may be provided in one of the following forms:

• Loans (Debt): Financing repaid over time with interest. Typical investments range from $250,000 to $10 million.
• Equity: Capital provided in exchange for an ownership stake. Typical investments range from $100,000 to $5 million.
• Debt + Equity: A combination of financing and ownership investment. Typical investments range from $250,000 to $10 million.

Getting Started.

To get started, take the following steps:

1. Confirm eligibility. Ensure your company qualifies as a U.S. small business under SBA size standards.
2. Evaluate your fit. Determine whether your business operates in areas such as advanced manufacturing, aerospace, communications, software, materials, energy, propulsion, or other technologies aligned with NASA’s priorities.
3. Identify potential investment funds. Search the SBA Directory and look for funds (i.e., SBICs) that invest in your industry, growth stage, and financing needs.
4. Build your business case. Be prepared to explain your technology, growth strategy, market opportunity, and how additional capital will help your business scale.
5. Engage with investors. Contact funds whose investment strategies align with your business to discuss potential financing opportunities.

Learn more about the SBA SBIC Program –
https://www.sba.gov/loans/additional-funding-opportunities/investment-capital/

For details about this new initiative and NASA’s Office of Strategic Space Finance, visit – 
https://www.nasa.gov/strategiccapital